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It's a case of walking before they might have to run, with Prime Minister Malcolm Turnbull teaming up with the heads of Australia’s four big banks to call the banking Royal Commission.
The bankers chose their words carefully. In the letter sent to Treasurer Scott Morrison expressing their new-found desire for the commission, there is no mention of the rip-offs, dodgy-dealing and selfish skulduggery that has come to define the Aussie banking scene.
Their motives, by their own account, are patriotic, pure and altruistic. They want to support the "national interest" and put "political uncertainty to an end" so that they get back to the business of making Australia great.
Never mind solving the endemic problems of a concentrated industry racked by crime and scandal, the banks just want this "costly and unnecessary distraction" to be all over and done with — quick smart.
The industry is not even trying to conceal its penchant for haste and superficiality.
Without the thinnest pretence that there might be anything rotten in the state of the banks, an analyst from Deutsche is worried about the
‘ ... risk that further misconduct issues could arise in the course of the inquiry’.
In what myopic world view can this inquiry be reduced to being a risk to be mitigated? Uncovering misconduct is the whole purpose of the commission — not a potentially damaging and unwanted side effect.
Never mind, the risks are small anyway.
A J P Morgan analyst seems quite chuffed to say that the "downside" will be minimal:
' ... given the narrow focus of the inquiry and short timeframe involved’.
Great! So, the good thing about the inquiry is that it won’t do much and will be over within no time?
Even Immigration Minister Peter Dutton chimed in hoping the inquiry would provide "closure around what’s been a difficult situation". There is just a willful ignorance of the fact that the reason Australians were demanding the inquiry was to uncover these "issues", not to close them down because they make wealthy business people squeamish.
The Government does not appear remotely willing to admit that the reason for the inquiry is because of the sector’s atrocious record of injurious and illegal behaviour. So why are having this commission? Scott Morrison’s answer is that ‘politics is doing damage to our banking and financial system’.
What about the bankers themselves, Scott? Isn’t the commission supposed to be uncovering the damage they have done? You can just see it coming, bankers will be found breaking the law to line their own pockets and Labor and the Nationals will be held to blame.
Despite all this talk of a low risk, rapid results Royal Commission, surely the commitment should be to fully lift the lid on whatever has been going on in the industry? Not so for the Coalition. The status of this as a "Clayton’s" royal commission is written straight into the Terms of Reference. As you’d expect, it states that it will find out what’s been going wrong, why it’s been going wrong and how new laws and practices can fix it.
More revealing is how the terms set strict limits as to what can be considered as causes of wrongdoing. For the Commission, the only possible causes of banks-behaving-badly are "culture and governance practices", or "remuneration, recruitment and risk behaviour".
Limiting the scope to specific practices echoes Turnbull’s hyperbole in declaring ‘It’s not going to put capitalism on trial’. Turnbull has always been at the ready to use hackneyed political scare tactics that went out of fashion in the 1980s. True to form, positioning this as some class-war battle between capitalism and socialism is a weak attempt to side-step the real issues.
On the one hand, we have an industry that has been exposed time and time again for rampant profiteering, back-pocket financial dealings, toxic work cultures and self-interested executive salary escalation. On the other, this is the same sector that has profited handsomely from market deregulation, escalating income and wealth inequality and record levels of housing unaffordability.
So far, all we really know about the Royal Commission is that it has been set up in the name of commercial and political expediency. The deliberate aim is to not deal with the important issues.
Does Australia have the political stomach to stand up to the Government and the bankers and ask the questions that really need to be answered? We’ll have to wait and see. But the way Turnbull and the Coalition have played it so far, the odds are stacked in the banks’ favour.
Carl Rhodes is Professor of Organisation Studies at UTS Business School.
This opinion piece was first published on Independent Australia.